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To promote stable, constructive labor-management relations through the resolution and prevention of labor disputes in a manner that gives full effect to the collective-bargaining rights of employees, unions, and agencies.

This unfair labor practice case is before the Authority under section
2429.1(a) of the Authority's Rules and Regulations, based on a stipulation of
facts by the parties. The issue is whether the Respondent violated section
7116(a)(1) and (5) of the Federal Service Labor - Management Relations Statute
(the Statute) when it unilaterally terminated the representation of the Charging
Party (the Union) on an incentive awards committee and, thus, repudiated a
Memorandum of Understanding with the Union. We conclude that the Respondent
violated the Statute.

II. Facts

The Union is the exclusive representative of a unit of the Respondent's
employees. On September 6, 1984, the Respondent and the Union entered into a
Memorandum of Understanding concerning incentive awards. The Memorandum of
Understanding provided as follows:

There shall be established a Joint Management/ Union Incentive Awards
Committee which will administer the Incentive Awards Program and recommend
modifications to the program to the Commanding Officer and Technical Director.
[PAGE]

Additionally, the Committee will vote on proposed individual and/or group
awards recommended by supervisors for unit employees. In the event of a tie vote
of the six (6) voting members, of whom three (3) are selected by Management and
three (3) are selected by the Union, the award will be remitted to the
recommending supervisor with reasons for remission. If the supervisor decides to
resubmit the award and the Incentive Awards Committee is still deadlocked, the
award will then be submitted to the Commanding Officer with comments, if so
desired. In the event of a positive vote, the award recommendation will be
submitted to the Commanding Officer for approval. The Chairperson will be the
Deputy Technical Director and the Assistant Chairperson will be a Union designee
who will conduct meetings in the absence of the Chairperson. The Assistant
Chairperson will be provided copies for comment and review of all communications
between the Commanding Officer and Chairperson and will sit in on all meetings
between the Commanding Officer and Chairperson dealing with Incentive Awards.

Between November 13, 1984, and May 18, 1986, the Respondent and the Union
abided by the terms of the Memorandum of Understanding.

On May 19, 1986, the Respondent informed the Union that it would no longer be
allowed to have any representative on the Incentive Awards Committee. In its
letter, the Respondent also indicated a willingness to negotiate concerning the
impact and implementation of this change. The parties stipulate that since May
19, 1986, the Union has not been afforded representation on the Committee or
played any role regarding incentive awards for the employees it represents.

III. Positions of the Parties

The Respondent contends that its action was necessitated by the Authority's
decision in Department of the Navy, Northern Division, Naval Facilities
Engineering Command 19 FLRA 705 (1985) (NAFEC), rev'd and remanded sub nom.
National Federation of Federal Employees Local 1430 v. FLRA, No. 85-1648 (D.C.
Cir. Nov. 6, 1986). The Respondent argues that under the Authority's decision in
NAFEC, a union was not entitled to have a representative on an incentive awards
committee even if the representative was only present [ v30 p2 ] as an observer.
The Respondent also argues that its action was consistent with Authority case
law, which, the Respondent asserts, precludes union representation on any
committee that substantively deliberates over the exercise of management's
rights under the Statute. The Respondent argues that this principle has been
applied to incentive award committees, citing the Authority's decision in
National Treasury Employees Union and Internal Revenue service, 14 FLRA 463
(1984) (IRS), rev'd and remanded sub nom. NTEU v. FLRA, 793 F.2d 371 (D.C. Cir.
1986). The Respondent recognizes that the Authority's decisions in NAFEC and IRS
were reversed. However, the Respondent contends that the effect of the court's
decision in NAFEC was expressly limited because the Authority only adopted the
court's decision as "the law of the case" and did not overrule other decisions.
Department of the Navy, Northern Division, Naval Facilities Engineering Command,
24 FLRA 907 (1986). The Respondent further argues hat IRS was limited to the
question of the negotiability of the rate or level of incentive pay for the
performance of agency work.

The General Counsel contends that the Union's role on the Joint
Management/Union Incentive Awards Committee did not interfere with the exercise
of management's rights under section 7106(a)(2)(A) and (B) of the Statute to
direct employees and to assign work. In support of its contention, the General
Counsel relies on the Authority's decision on remand in the IRS case, National
Treasury Employees Union and Internal Revenue Service, 27 FLRA 132 (1987). The
General Counsel argues that the Authority appears to have adopted the view of
the court that section 7106(a)(2)(A) and (B) does not confer on management the
sole prerogative to determine when to reward superior performance. The General
Counsel further argues that an exclusive representative lawfully may perform a
role on a committee administering an incentive awards program.

The General Counsel also contends that the provision in the Memorandum of
Understanding which created the Joint Incentive Awards Committee constitutes a
lawful condition of employment within the meaning of section 7103(a)(14) of the
Statute. The General Counsel argues that the Respondent summarily terminated the
Union's participation on the Committee without affording the Union an
opportunity to bargain concerning the decision. The General Counsel maintains
that the Respondent's offer to bargain over the impact and implementation of the
decision is irrelevant because the Respondent could not lawfully insist upon
altering the terms of the negotiated agreement and could not abrogate the
agreement. The General Counsel concludes that [ v30 p3 ] the Respondent repudiated
the Memorandum of Understanding in violation of section 7116(a)(1) and (5) of
the Statute.

As to a remedy for the alleged unfair labor practice, the General Counsel
argues that a status quo ante remedy is appropriate in order to effectuate the
purposes and policies of the Statute. The General Counsel argues that this case
is similar to the situation in NAFEC, in which the Authority concluded on remand
from the court that a status quo ante remedy was mandated by the Statute because
management had made a unilateral change in a negotiable term and condition of
employment and effectuation of the purposes and policies of the Statute required
a return to the status quo in order not to render meaningless the obligation to
negotiate.

IV. Analysis and Conclusion

We turn first to the Respondent's argument that the Union's representation on
the Joint Management/Union Incentive Awards Committee, as described in the
Memorandum of Understanding, is contrary to the Statute. We disagree with that
argument.

We have held that union membership and participation on an incentive awards
committee does not interfere with management's rights under section 7106(a) of
the Statute. American Federation of Government Employees AFL - CIO Local 1815
and Army Aviation Center, Fort Rucker, Alabama, 28 FLRA 1172 (1987) (Provision
9); National Federation of Federal Employees, Local 1256 and K. I. Sawyer Air
Force Base, Michigan, 29 FLRA 171 (1987) (Provision 2); National Federation of
Federal Employees, Local 797 and Department of the Navy, 29 FLRA 333 (1987)
(Provision 2). See also National Federation of Federal Employees, Local 541 and
Veterans Administration Hospital, Long Beach California, 12 FLRA 270 (1983);
National Federation of Federal Employees, Local 1579 and Veterans Administration
Regional office Louisville, Kentucky, 12 FLRA 600 (1983) (Proposal 1). Clearly,
therefore, an exclusive representative may fully participate on an incentive
awards committee.

As noted above, the Respondent relied on the Authority's decision in NAFEC to
repudiate the Memorandum of Understanding. That decision, however, was reversed.
In our decision on remand, 24 FLRA 907, we adopted the court's view that section
7106(a)(2)(A) and (B) of the Statute does not [ v30 p4 ] confer on management the
sole prerogative to determine whether to reward superior performance.
Furthermore, in our decision and order on remand in IRS, 27 FLRA 132, we found
that the proposal determining the level or rate of incentive pay to be awarded
to employees under the agency's productivity plan did not interfere with
management's rights under section 7106(a) of the Statute.

Consistent with our decisions on remand in NAFEC and IRS, and with the other
decisions cited above, we find that the Union's membership and participation on
the Joint Incentive Awards Committee established by the Respondent and the Union
in their Memorandum of Understanding is not contrary to the Statute.

Since the Union's right to representation on the Committee was established
under the parties' negotiated agreement, the Respondent could not alter or
terminate that right without bargaining with the Union. The fact that the
Respondent relied upon an Authority decision to terminate the Union's role is no
defense. We decide an unfair labor practice complaint based on the law at the
time the case is before us. See U.S. Department of the Treasury, 27 FLRA 919
(1987), affirmed sub nom. U.S. Department of the Treasury v. FLRA, No. 87-1447
(D.C. Cir. Oct. 6, 1987).

Accordingly, we conclude that by summarily terminating the Union's
representation on the Joint Management/Union Incentive Awards Committee, the
Respondent repudiated the parties' Memorandum of Understanding and thereby
failed to bargain in good faith with the Union in violation of section 7116(a)
(1) and (5) of the Statute.

Turning to the General Counsel's request for a status ante remedy, we find
that such a remedy is warranted in order to effectuate the purposes and policies
of the Statute. Consistent with our decision in NAFEC on remand, we find that a
status quo ante remedy is appropriate where, as here, management has
unilaterally changed a negotiable term and condition of employment. Effectuation
of the purposes and policies of the Statute requires a return to the status quo
ante, in order not to render meaningless the obligation to bargain. Accordingly,
we order the Agency to, among other things, rescind its Memorandum which
repudiated the parties' agreement and to comply with the terms of that
agreement.

(a) Unilaterally repudiating a September 6, 1984, Memorandum of Understanding
with the Federal Union of Scientists and Engineers/NAGE, Local R1-144 (the
Union), the exclusive representative of a unit of its employees, by refusing to
allow Union representation on the Joint Management/Union Incentive Awards
Committee without affording the Union the opportunity to bargain, to the extent
consistent with law and regulations, on the decision to effectuate such an
action.

(b) In any like or related manner, interfering with, restraining or coercing
its employees in the exercise of the rights assured them by the Statute.

2. Take the following affirmative action in order to effectuate the purposes
and policies of the Statute:

(a) Rescind its memorandum dated May 19, 1986, which repudiated the
Memorandum of Understanding with the Union and unilaterally terminated the
Union's right under the Memorandum to representation on the Joint
Management/Union Incentive Awards Committee.

(b) To the extent consistent with law and regulations, restore and comply
with the terms of the September 6, 1984, Memorandum of Understanding.

(c) Notify the Union of any intention to change the provisions of the
Memorandum of Understanding and, on request, bargain with the Union, to the
extent consistent with law and regulations, on any decision to effectuate such a
change.

(d) Post at its facilities at the Naval Underwater Systems Center, Newport,
Rhode Island, copies of the attached notice on forms to be furnished by the
Federal Labor Relations Authority. Upon receipt of such forms, they shall be
signed by the Commander, and shall be posted and maintained for sixty (60)
consecutive days thereafter in conspicuous places, including all bulletin boards
and places where notices to employees are customarily posted. Reasonable steps
shall be taken to ensure that such notices are not altered, defaced, or covered
by any other material. [ v30 p6 ]

(e) pursuant to section 2423.30 of the Authority's Rules and Regulations
notify the Regional Director, Region I, Federal Labor Relations Authority, in
writing, within 30 days from the date of this order as to what steps have been
taken to comply.

Issued, Washington, D.C., December 31, 1987.

Jerry L. Calhoun, Chairman

Jean McKee, Member

FEDERAL LABOR RELATIONS AUTHORITY [ v30 p7 ]

NOTICE TO ALL EMPLOYEES
AS ORDERED BY THE FEDERAL LABOR RELATIONS AUTHORITY
AND TO EFFECTUATE THE POLICIES OF THE
FEDERAL SERVICE LABOR-MANAGEMENT RELATIONS STATUTE
WE NOTIFY OUR EMPLOYEES THAT:

WE WILL NOT unilaterally repudiate a September 6, 1984, Memorandum of
Understanding with the Federal Union of Scientists and Engineers/NAGE, Local
R1-144 (the Union), the exclusive representative of a unit of our employees, by
refusing to allow Union representation on a Joint Management/ Union Incentive
Awards Committee without affording the Union the opportunity to bargain, to the
extent consistent with law and regulations, on the decision to effectuate such
an action.

WE WILL NOT, in any like or related manner, interfere with, restrain, or
coerce our employees in the exercise of the rights assured them by the Federal
Service Labor - Management Relations Statute.

WE WILL rescind our memorandum dated May 19, 1986, which repudiated the
Memorandum of Understanding with the Union.

WE WILL, to the extent consistent with law and regulations, restore and
comply with the September 6, 1984, Memorandum of Understanding.

WE WILL notify the Union of any intention to change the provisions of the
Memorandum of Understanding and, upon request, bargain with the Union to the
extent consistent with law and regulations, on any decision to effectuate such
action.